1. Firm I has variable cost VCi = yi^2/10 and fixed cost FCi = 2000. (1)...

1. Firm I has variable cost VCi = yi^2/10 and fixed cost FCi = 2000.

(1) Find total cost Ci(yi), average cost ACi, marginal cost Mci and the firm supply function Si(p)

(2) There are n=50 firms identical to firm I, facing a market demand of D(p) = 1000-250p. Find the market supply function S(p), the market equilibrium price p*, the market equilibrium quantity Y*.

(3) Given price p* you found in part b, what is the profit maximising yi* that firm i produces? How much profit does firm i make?

Expert Solution

Rahul Sunny answered 7 months ago

2. Firm I has variable cost VCi = yi^2/10 and fixed cost FCi = 2000. (1)...

2. Firm I has variable cost VCi = yi^2/10 and fixed cost FCi = 2000. (1) Find total cost Ci(yi), average cost ACi, marginal cost Mci and the firm supply function Si(p) (2) There are n=50 firms identical to firm I, facing a market demand of D(p) = 1000-250p. Find the market supply function S(p), the market equilibrium price p*, the market equilibrium quantity Y*. (3) Given price p* you found in part b, what is the profit maximising yi*...

A firm has the total variable cost function: ??? = 2? + 2?^2 and total fixed...

A firm has the total variable cost function: ??? = 2? + 2?^2 and total fixed cost of $20. Suppose the market demand is: ? ? = 20 − ?. a. What are the firm’s profit maximizing output and price if it is a monopolist? How much is its profit at this output level? How much is consumer and producer surplus? (Hint: use a diagram to illustrate the market), b. Suppose the government implements a tax of $3 tax unit...

If a firm has a total fixed cost of $75 and an average variable cost of...

If a firm has a total fixed cost of $75 and an average variable cost of $35 for producing 10 units of output, the average total cost would be: If a firm has an average total cost of $55 and an average fixed cost of $10 for producing 5 units of output, then the total variable cost will be:

An online stock trading firm has a fixed cost of $1700 and a variable cost of...

An online stock trading firm has a fixed cost of $1700 and a variable cost of $6.5x, where x is the number of clients that suscribe to the firm's trading service. If the firm has 170 clients, what is the lowest price it can charge each client without pushing total revenue below cost? $12.5 $10.5 $16.5 $20 Question 2 Say that a buyer of bonds values good bonds at $400 and values bad bonds at $250. Sellers of both good...

A firm has a fixed cost of $100 and average variable cost of $5xq, where q...

A firm has a fixed cost of $100 and average variable cost of $5xq, where q is the number of units produced. a. Construct a table showing total cost for q from 0 to 10. b. Graph the firms marginal cost and average total cost curves. c. How does marginal cost change with q? What does this suggest about the firm’s production process?

2. Describe a fixed cost, variable cost. Explain why the variable and fixed costs are important...

2. Describe a fixed cost, variable cost. Explain why the variable and fixed costs are important in cost accounting. Give your opinion

A firm has provided you with the following information: Output 30, Variable Cost $1,900, Fixed Cost...

A firm has provided you with the following information: Output 30, Variable Cost $1,900, Fixed Cost $120,Marginal Cost $50, Price $50 Instructions: To indicate a loss enter a (-) in front of your answer. A positive entry is considered a profit. 1. What is the firm's short-run profit if they produce using the MC=MR rule? 2. What is the firm's short-run profit if they produce nothing? 3. What will be the firm's production decision in the short-run? a. Shutdown b....

1.Amber Angler's fixed operating costs are $2m and its variable cost ratio 70%. The firm has...

1.Amber Angler's fixed operating costs are $2m and its variable cost ratio 70%. The firm has $2.1m in bonds outstanding at an interest rate of 4%. Amber has 0.05m shares of preferred stock which pays a $4 dividend. Crow is in the 40% corporate income tax bracket. Forecasted sales for next year are $9m. What is Amber's degree of financial leverage? Round to two decimal places. b.A firm with a DFL of 1.9 expects EBIT to increase by 3.90%. If...

A firm incurred a total fixed cost of $400,000 and total variable cost of $600,000 to...

A firm incurred a total fixed cost of $400,000 and total variable cost of $600,000 to produce 50,000 units of output. What are the average fixed cost (AFC), average variable cost (AVC), and average total cost (ATC)?

1. Define variable cost, fixed cost, and mixed cost. 2. Describe what happens to the net...

1. Define variable cost, fixed cost, and mixed cost. 2. Describe what happens to the net income of a company under each of the following assumptions: (a) Units sold are less than break-even units. (b) Units sold are greater than break-even units. (c) Units sold are equal to the break-even units

Question